River Road Asset Management, an investment management company released its “River Road Large Cap Value Select Fund” Q4 2024 investor letter. A copy of the letter can be downloaded here. In the fourth quarter, AMG River Road Large Cap Value Select Fund returned 0.43% compared to (1.98%) return for the Russell 1000® Value Index. For the year 2024, the fund returned 24.59% significantly outperforming Index return of 14.37%. Stocks rallied in November after a Republican victory but declined sharply following hawkish Fed comments. Shorter duration stocks, including small caps and value, lost most of their post-election gains by the end of December. For more information on the fund’s best picks in 2024, please check its top five holdings.
In its fourth quarter 2024 investor letter, River Road Large Cap Value Select Fund emphasized stocks such as Fairfax Financial Holdings Limited (OTC:FRFHF). Fairfax Financial Holdings Limited (OTC:FRFHF) offers property and casualty insurance and reinsurance, and investment management services. The one-month return of Fairfax Financial Holdings Limited (OTC:FRFHF) was -0.46%, and its shares gained 32.67% of their value over the last 52 weeks. On March 27, 2025, Fairfax Financial Holdings Limited (OTC:FRFHF) stock closed at $1,431.62 per share with a market capitalization of $32.072 billion.
River Road Large Cap Value Select Fund stated the following regarding Fairfax Financial Holdings Limited (OTC:FRFHF) in its Q4 2024 investor letter:
“Another top contributor during the quarter was Fairfax Financial Holdings Limited (OTC:FRFHF), a Canadian holding company focused on property and casualty (P&C) insurance and reinsurance. Like the more famous Berkshire Hathaway, FRFHF follows a disciplined approach to underwriting insurance—the company has not chased market share and focuses on writing profitable insurance policies in addition to generating attractive investment returns with the float. Chairman and CEO Prem Watsa has a 9.1% economic interest and controls 44% of the vote (opportunistically purchasing an additional $149MM at $308/share in 2020) and has a track record of opportunistic company share buybacks, including a -7% share reduction in 2021 at highly attractive prices. Despite compounding book value at ~18% over the past 39 years (since Watsa took over the Canadian operations of Markel), the stock ended the quarter trading at 1.3x, which we believe is an understated book value and a significant discount to its peer group.
Fairfax Financial Holdings’ stock increased as the company delivered exceptional results across all business segments, generating an impressive 93.9% combined ratio, driving a 33.6% increase in underwriting profit despite significant catastrophe losses. The investment portfolio capitalized on high interest rates, generating interest and dividend income of $610MM (up +19% year over-year) with an annualized run rate of $2.4B. Book value per share increased 19.6% year-over-year to $1,033, with an additional $63 per share in hidden value from associates not reflected in book value. We maintained the position.”
A woman in a business suit in an insurance office, analyzing a policy.
Fairfax Financial Holdings Limited (OTC:FRFHF) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 1 hedge fund portfolios held Fairfax Financial Holdings Limited (OTC:FRFHF) at the end of the fourth quarter compared to 1 in the third quarter. While we acknowledge the potential of Fairfax Financial Holdings Limited (OTC:FRFHF) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
In addition, please check out our hedge fund investor letters Q4 2024 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.